Fortress Investments has made a $25 million bet on a San Francisco redevelopment area, buying a warehouse-style building that houses several art galleries, according to public records.
The Texas branch of the global investment group bought 1150 25th Street in the city’s Dogpatch neighborhood for just under $25 million in early June. Since 1999, it has been owned by Trinity LLC, which is affiliated with a commercial electrical contractor in the city called the Edward W. Scott Electric Company. Neither the power company nor Fortress responded to a request for comment on the sale.
The two-level building sits on two parcels that total 1.2 acres at the corner of 25th and Indiana streets. It has over 37,000 square feet, which is leased to several art galleries through the Minnesota Street Project. The arts group runs programs in three converted warehouses in the neighborhood. Two are gallery spaces and one is an artist studio program; all have their postal addresses engraved on their industrial facades.
The building at 1150 25th Street is divided; MSP’s offices are in Building A and Building B has three gallery spaces: Altman Siegel, McEvoy Foundation for the Arts and Slash. MSP did not respond to a request for comment on how it might be impacted by the sale.
There are many arts organizations and galleries in the neighborhood east of Potrero Hill and south of Mission Bay. Like the latter district, the Dogpatch was a long-standing industrial area that flourished when the central waterfront was a hub for the shipbuilding and shipping industries. After the end of the Second World War, jobs dried up, people moved away and the area fell into abandonment and disrepair.
Artists arrived in the area in the 1970s, attracted by low prices and a desire to repair some of the city’s oldest housing stock, as the neighborhood’s removed location spared its ornate Victorians from the fires caused by the earthquake of 1906. By the 1990s, redevelopment had begun in earnest, and today the neighborhood is home to a mix of art galleries, tech companies, trendy restaurants, and loft-style apartments.
More changes are on the way. In 2020, the 29-acre Potrero Power Plant mixed-use project was approved by the city and “will open much of the city’s central waterfront to the public for the first time in 150 years,” according to the city planning department. The project will include a 3-acre waterfront park, over 2,500 homes and 1.8 million square feet of retail space. The project is just one of many large-scale developments in the city’s central waterfront area plan, which also includes a partnership between Brookfield and the Port of San Francisco to transform the historic Pier shipyard. 70 into “a real estate and operational creative platform for innovation and cross-pollination between technology, arts, manufacturing and design to create a premier mixed-use neighborhood,” according to Brookfield.
The developer had already spent nearly $240 million on the $3.5 billion project before it shut down last spring, citing “the ongoing economic impacts of the pandemic and construction costs on viability vertical development. He pledged to continue the project when it made financial sense to do so.